International Law

Does ACN run a Commissions Scam?

Here is an interesting observation about ACNCreating A Lifetime Income from telecomunications industry

The authors claim that

Commissions on items like, land line connection fees you only get ½ commission rates, and you cannot offer your services to major businesses, and what is worse it is virtually impossible to confirm if the amount ACN pay you as commission is correct, as they don?t give you a copy of your clients bill ( they claim privacy issues) to check what they pay you is correct ! So guess what ? you get paid what they calculate and for reps this is virtually impossible to calculate. They also keep a % for bad debts ! Can you imagine that ! You have no control over who is paying and what arrangements ACN accounts department has with your clients, yet if they stuff up their own financial management with which you have no control over, they take the amount out of your commissions. You are meant to be responsible for bad debts.

You cannot cold call clients for business. In every other business you can do your own marketing, but not with ACN, they only want your friends and family ( those loyal to you) who are unlikely to leave ACN due to their relationship with you, and similarly with your downline reps, you are encouraged to ?stitch? up their friends also.

One huge market you cannot offer a competitive solution to is retirees, as ACN cannot match the discounted line rental given to this class of customer. Also 10% discounts offered to other telco networks for bundling of mobile, land line and cable TV also are not matched.

Is this the hallmark of a fraud? Paying you a commission cheque which it is impossible to verify? Perhaps, it is certainly a very dubious practice.

One which no legitimate company or franchise system would engage in. Right?

Well, the next time you are reviewing the UFOCs at the Caleasi site, look at how many franchisors use electronic funds transfer, or ETF, to sweep the franchise royalties from your operating line into their account. Is there a similar mechanism for repayment for reconciliation on invoices that are wrong? I don't think so.

Here is the AAFD's Standard, or best practice, regarding electronic payments.

STANDARD 18.10 ELECTRONIC PAYMENTS of ROYALTIES & FEES

A Franchisor has the right to embrace current technology regarding electronic funds transfer and payments for the mutual benefit of the franchise system. The use of electronic fund transfers should recognize and respect a franchisees right and ability to control cash flow decisions, including both the power to direct the use of cash and credit resources and the franchisees right to allow or disallow the transfer of funds.

If you don't control your cash flow, you aren't operating a business. You may as well become an ACN representative.

Full post as published by Misleading Advertising Law on November 21, 2007 (boomark / email).